CANADA STOCKS-TSX dips on financials as euro zone fears weigh

4 Min Read

* TSX down 16.17 pts, or 0.1 pct, at 11,549.90
* Financial shares fall on Greek worries
* Energy, gold miners pare losses
By Jon Cook
TORONTO, May 25 (Reuters) - Toronto's main stock index was
s lightly lower on Friday in choppy trade ahead of the U.S.
holiday weekend, as gains in resource shares were offset by
losses in the financial sector on mounting concerns about the
risk of Greece leaving the euro zone.
The worries about the impact of a potential Greek exit on
the global banking community and mixed second-quarter earnings
results from Canada's top banks sent financial shares down 0.9
percent.
Shares of Royal Bank of Canada, Canada's largest
bank, tumbled for the second straight day, falling 2.2 percent
to C$50.25 after the bank reported a 7 percent decline in
quarterly earnings on Thursday. Bank of Nova Scotia,
which reports earnings next week, fell 1.8 percent to C$50.49.
Not even a good earnings result spared Toronto-Dominion Bank
, Canada's No. 2 bank, whose shares slid 0.8 percent to
C$78.38 a day after it reported a 20.7 percent rise in quarterly
profit.
Most of Canada's top six banks' share prices are now trading
below year-ago levels as the earnings growth environment has
cooled.
"We're living day-to-day off headlines with no real
direction," said Paul Hand, managing director at RBC Capital
Markets. "It's not a dynamic environment that leads people to go
out and get all excited and do things."
Hand added that most large institutional investors are doing
marginal trading "around the edge," and the resource money is
parked "because it's been such a miserable four or five quarters
for them."
At 11:15 a.m. (1515 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was down 16.17 points, or 0.1
percent, at 11,549.90. The TSX was still on track for its first
weekly gain this month.
Worries about a potential Greek exit from the euro zone and
its impact on the global banking community were compounded by
comments on Friday from Belgium's deputy prime minister, Didier
Reynders, about the need to prepare for a possible Greek exit
from the euro.
"If central banks and companies are not preparing for the
scenario, that would be a grave professional error," Reynders
told a conference in Paris.
Energy shares, up 0.5 percent, helped pare losses as U.S.
oil prices rose after data on Friday showed U.S. consumer
sentiment improved to its highest level in more than four years
in May.
The subgroup of gold mining stocks, up 0.7
percent, was boosted as gold prices continued to rebound from
multi-month lows set earlier in the week.
"It has mostly been reflected in the big cap stocks," said
Hand. "The smaller and mid-cap resource stocks are still
suffering a malaise with respect to their futures with
development and capital costs rising."
The most influential gainers among resource firms included
Barrick Gold, up 1.1 percent to C$40.94, Goldcorp Inc
, which rose 0.9 percent to C$38.72, Suncor Energy
, up 1 percent at C$28.77, and Canadian Natural Resources
, which climbed 0.6 percent to C$31.61.
Also helping sentiment was data on Friday that showed
Canadian housing prices remained strong. Prices climbed 5.2
percent in April from a year earlier, boosted by strong gains in
the Toronto market as well as increases in Vancouver and
Calgary, the Canadian Real Estate Association said.